London close: Ex-divs, Wall Street hammer Footsie
London suffered a pounding Wednesday, sinking lower through the afternoon as Wall Street took an early knock after higher labour costs raised US rate hike fears.
Ex-dividend issues over here also weighed, with Alliance & Leicester, Slough Estates, Amvescap, Corus, Legal & General and BHP Billiton all trading without the right to the latest payout.
DSG International succumbed to profit taking after reporting like-for-like sales up 5% in the 16 weeks to 19 August with like-for-like gross margin in line with the same period last year. Flat screen TV sales boosted the figures.
Tobacco giant Gallaher slipped despite reporting a better-than-expected 4% rise in half-year profits to £275m, adding its outlook for the rest of the year was in line with its expectations despite some tough European markets.
Utility supplier Drax tumbled as Merrill Lynch downgraded the stock to "neutral" from "buy" citing valuation grounds.
Support services group Capita's contract to operate London's congestion charging zone has been extended by 21 months from the end of the initial contract in February 2008 until November 2009.
Elsewhere, Goldman Sachs lifted its target on GlaxoSmithKline to 1,610p per share from 1,570p previously, arguing that it trades at a discount to European peers.
UBS lifted its price target on publisher Reed Elsevier to 675p from 645p, arguing that it currently trades at a discount to its peers and with its defensive qualities it should be commanding a premium.
US crude slipped back to $68 a barrel today, helping fuel sensitive stocks Carnival and British Airways higher, although oil prices narrowed losses later.
Pizza Express owner Gondola announced it was in bid talks, though it didn't say who the suitor was. The group said the cash approach came at 415p per share.
Retailer Woolworths was also up on hopes of a bid after press reports suggested that it could be broken up under a takeover plan devised by Icelandic investor Baugur.
Contractor Carillion agreed to sell its stake in eight Public Private Partnership projects to two secondary market funds. Half-year underlying profits rose 23% to £24.7m, while orders have climbed to £14.5bn, it added.
Pub owner Punch Taverns said trading across the group has continued in line with company expectations. Sales at its 7,846 leased pubs rose 1% on a like-for-like basis in the year to August 19.
Housebuilder Wilson Bowden reported a drop in first half pre-tax profit amid a sluggish housing market, but says the outlook for the rest of the year remains positive.
Oil and gas explorer Tullow Oil increased first half profit 51% and said it expects to hike production to 75,000 boepd by the end of the year.
Surgical equipment group Gyrus and Medtronic Xomed have agreed to settle a long-running patent infringement dispute brought against Gyrus ENT by Medtronic. There are no damages or payments involved and each party will be responsible for its own costs.
Specialist holiday business Holidaybreak says trading prospects remain satisfactory, adding that it expects to deliver double-digit margins again and be strongly cash generative with year-end net debt substantially reduced.
Shares in Pennant International catapulted forward as interim pre-tax profits surged with the information training provider adding that current trading is strong.
Skyepharma perked up as it found a European partner for its asthma treatment Flutiform.
FTSE 100 - Risers
Reed Elsevier (REL) 569.00p 0.80%
Next (NXT) 1,680.00p 0.78%
PartyGaming (PRTY) 117.25p 0.64%
Compass Group (CPG) 257.00p 0.59%
BT Group (BT.A) 249.50p 0.40%
Smiths Group (SMIN) 869.50p 0.35%
William Morrison (MRW) 220.00p 0.34%
Aviva (AV.) 742.50p 0.34%
Carnival Corporation (CCL) 2,288.00p 0.31%
Kazakhmys (KAZ) 1,333.00p 0.15%
FTSE 100 - Fallers
Schroders (SDR) 921.00p -3.36%
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DSG International (DSGI) 202.75p -3.34%
British Energy Group (BGY) 667.00p -3.33%
Drax (DRX) 907.00p -3.30%
Cairn Energy (CNE) 2,055.00p -3.29%
BHP Billiton plc (BLT) 1,016.00p -3.24%
Schroders Nv (SDRC) 872.50p -3.06%
ICAP (IAP) 460.00p -2.95%
Anglo American (AAL) 2,327.00p -2.84%
Legal & General (LGEN) 132.50p -2.57%
FTSE 250 - Risers
Gondola Holdings (GND) 402.00p 11.05%
888 Holdings (888) 171.00p 9.79%
Randgold Resources (RRS) 1,340.00p 6.35%
Northern Foods (NFDS) 85.00p 4.62%
Admiral Group (ADM) 692.00p 3.28%
Rank Group (RNK) 232.00p 3.11%
Beazley Group (BEZ) 107.00p 2.88%
Restaurant Group (RTN) 208.00p 2.46%
Soco International (SIA) 1,329.00p 2.23%
Carillion (CLLN) 332.25p 2.23%
FTSE 250 - Fallers
Meggitt (MGGT) 303.25p -4.56%
CSR (CSR) 1,165.00p -4.04%
Derwent Valley (DWV) 1,767.00p -3.86%
St Modwen Property (SMP) 475.50p -3.65%
British Assets Trust (BSET) 130.00p -3.35%
Pendragon (PDG) 509.00p -3.14%
Taylor Woodrow (TWOD) 348.25p -2.99%
Wilson Bowden (WLB) 1,698.00p -2.97%
Speedy Hire (SDY) 930.00p -2.87%
Provident Financial (PFG) 641.00p -2.81%
